Shares in Tanfield have crashed 40% after its electric car associate Smith Electric Vehicles abandoned plans for a US flotation.
Tanfield owns 24% of Smith, following the sale last year of its vehicle business to its US partner. This left Tanfield to concentrate on its remaining division, Snorkel aerial work platforms.
Smith, based in Kansas City, planned to offer $92m worth of shares at $16 to $18 each, in a flotation on Nasdaq, with Tanfield selling part of its stake.
But now Smith has withdrawn its application, with its chief executive Bryan Hansel saying:
We received significant interest from potential investors. However we were unable to complete a transaction at a valuation or size that would be in the best interests of our company and its existing shareholders. We have instead decided to pursue private financing opportunities to support the execution of our business plan.
In July Tanfield raised £2m in a placing which it passed on to Smith as a short-term bridging loan. This was due to be repaid once Smith's initial public offering was completed.
Tanfield shares are down 20.5p at 30.5p.
